thank you for the above. From what you say, there appear to be three potential issues here. Firstly there is the potential question of a boundary dispute which is likely to be the more complex issue of the three; secondly there is the question of trespass and criminal damage potentially to your fence posts and lastly there is a breach of permitted development planning on the part of your neighbour.
With your permission, I would deal with each in turn but in reverse order:
Under permitted development, it is possible to erect a fence up to 2 m in height without obtaining permission from the council. Note that the permitted height is reduced to 1 m if the fence is adjacent to a road. accordingly, you will neighbours actions amount to a breach of permitted development and you can report the matter to the local authority and an enforcement officer can serve an enforcement notice requiring the neighbour to remove the fence or the lower the height of the fence.
next I will agree that the fence posts to which is attached his fence must belong to you given the layout you describe.. If you have not already done so, it is worth you taking pictures to show the two sets of posts or if he has now removed his posts, take evidence of the holes where they used to be. On the basis that you can reasonably evidence that the fence post in question on your land, it follows that they are your property and he is not entitled to interfere with them, attach things to them or damage them in any way. If he does so, this can amount to both criminal damage and an act of trespass. The former can be dealt with by report to the police and the latter can be dealt with by a claim in the County Court.
Finally, there is a question of a potential boundary dispute. Based on what you say above, you interpretation seems perfectly logical but after whether the developer has retained a strip of land in between your respective properties, a search of the land registry index map would confirm. If there is such a strip, then neither of you own the strip of land in the middle and therefore neither of you have a right to place fence post there. that said, in the between gardens, it is unlikely the developer would have any interest in maintaining a claim to the same and if you and your neighbour were able to agree between you, there is probably no practical reason why you could not agree to cite one single fence somewhere in the middle or wherever you both agree so that you both gain a small amount of land. If you cannot agree however, this could amount to a potential boundary dispute which can be relatively costly to resolve not to mention stressful in terms of impact upon neighbourly relations.
In terms of how you may wish to proceed, so as not to escalate the matter to quickly to far, initially, you may wish to attempt to discuss the matter with your neighbour pointing out the various above issues and inviting him to remove the fence panels is attached to your fence posts on the above grounds that he has no right to attach them. If he is unwilling to cooperate, you may have to gently suggest to him that you will therefore be forced to take further action which may involve both the council as regards ***** ***** of planning,, the police as regards ***** ***** damage caused to your fence posts and potentially an application by you to the County Court for both damages and an order that he removes the panels from your posts. You can alternatively exercise what is known as self-help and simply remove the panels yourself without going to court but you would need to be careful not to damage his panels less you open yourself up to a potential claim by him of criminal damage to his fence panels difficult to such a claim might be.
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